Hilton Chairman Says Company Pursuing Atlantic City Casino License
BEVERLY HILLS, Calif. (AP) _ Hilton Hotels Corp. is in the market for an Atlantic City casino and has applied for a gaming license in case the right deal comes along, Chairman and President Barron Hilton told investors Thursday.
But Hilton’s comments at the firm’s annual shareholders meeting don’t mean the company, denied a license by New Jersey in 1985, has any specific property in mind, another company official said.
″Just going through this process will enable us to take a step if something comes along,″ Hilton General Counsel William Lebo said after the meeting. ″There are a number of hotels that would be good, Hilton-type hotels.″
Hilton, which has gaming operations in Nevada, has been readying itself since early this year to enter the depressed Atlantic City market. There has been speculation that the hotel giant would buy one of troubled developer Donald Trump’s three casinos, but Lebo declined to say whether Hilton was talking with Trump or any other Atlantic City operators.
″We’d take a look at any property. I don’t know that any of them is for sale,″ he said.
Industry analysts said Hilton is likely to buy only if it sees a real bargain, and the opportunity to pick up Trump properties at firesale prices may have passed.
″He and his managers have done a pretty good job of protecting his holdings. He’s not in as bad a shape as people thought he would be,″ said Michael Mueller, an analyst with Montgomery Securities in San Francisco.
James S. Schmidt, an analyst for Westcountry Financial, said Hilton still was smarting from its rejection in 1985.
Hilton’s 1985 application was denied after New Jersey Casino Control Commission officials examined Hilton’s ties to a lawyer with alleged mob connections.
The casino commission granted Hilton a rehearing, but before it took place, Hilton sold its hotel to Donald Trump for about $320 million. That hotel is now the Trump Castle.
″Hilton is a very conservative company and they’re very upset about what happened the first time. It would take some favorable situation to get them to want to go back there right away,″ Schmidt said.
However, Schmidt said the company’s low debt, about $500 million, and strong working capital line puts Hilton in a good position to expand its gaming operations if it chooses to do so.
Lebo said it was unclear when New Jersey’s latest review of Hilton would be complete.
″It’s been an extremely long process. We’ve had agents crawling all over us for months. It’s an extremely dedicated crew of investigators. They’re very thorough,″ he said.